FCC Delivers on Network Neutrality

1/03/2011 12:01 AM Eastern

By: John Eggerton

Washington — For chairman JulliusGenachowski, the Federal CommunicationsCommission’s historic vote on newnetwork-neutrality rules was a touchdownpass; for cable and telco operators, it wasthe equivalent of dodging a game-endingtackle; and net neutrality advocates saw itmore as a punt.

In search of a flexible solution in a changingmarketplace for broadband distributors, theagency proposed a definition of reasonablenetwork management and an enforcementmechanism on a case-by-case basis.

But fervent fans of network neutrality — whowish to ban broadband Internet-service providersfrom engaging in discriminatory managementof their networks to the commercialdisadvantage of Web-based content providers— saw the flexibility as a loophole for carriersto find creative ways to skirt the rule.

The net neutrality vote, which comes aftermore than a year of fierce debates and halfstarts,makes good on a top priority of Genachowski,as well as a campaign pledge byPresident Obama.

Cable operators and telcos will be able tomanage their networks for spam, spywareand traffic flow; to charge usage-based prices;and to at least make an argument for chargingmore for providing priority to some Internettraffic, all under a case-by-case FCC enforcementregime that leaves room for reviewing therules for modifications down the line.

While cable and telco ISPs did notwholeheartedly endorse the decision,they were grudgingly satisfied with an outcomethat avoided Title II reclassification,at least for now.

The FCC did not close its docket on reclassification,and the chairman could endorsea future “plan B” of the option if the agency’scurrent defense, based on Title I of the CommunicationsAct, does not hold up in court.Genachowski has said he is confident it willhold up this time around.

The commission’s 3-2 vote to codify its 2005Internet-openness guidelines struck such network-neutrality proponents as Free Press asnothing short of a giveaway to Internet serviceproviders. Insufficient network neutrality wasabout the highest praise the decision received,with phrases such as “lost” and “squandered”opportunity thrown in.

Free Press said the rules “heavily favor theindustry they are intended to regulate, andleave consumers with minimal protections.”That’s because the newrules left the door atleast ajar to paid prioritizationand allow forusage-based pricing.

For cable and telcooperators, it will bepretty much businessas usual for now — even as some networkcritics concede there has been little evidenceof anti-competitive practices. The commissiondid not concede that point. The FCC saidthat characterizing the order as only dealingwith “speculative harms” ignored “actual instancesof harmful practices by broadbandproviders,” adding, “In any event, the commissionis not required to stay its hand untilsubstantial harms already have occurred. “

FCC SETS HIGH BAR

If the multichannel-TV video-delivery modelmigrates online, as many predict, any paidprioritization, either over the public Internetor through so-called specialized broadbandservices, will face a high bar. The new rulespresume that paid prioritization is unreasonablediscrimination, though the industry hasa chance to argue otherwise on a case-by-casebasis.

While prioritization of so-called managedservices are not subject to the same presumptionof unreasonable discrimination — which could affect the health-care and emergencyresponse services the FCC has been touting— the agency will also monitor attempts to bypassthe rules via that route.

The FCC will have a fast-track complaintprocess and will also conduct its own investigations.Th e commission is even encouragingthe online community to join it as a cop onthe Internet-access beat, creating an “Open InternetApps” challenge to encourage privatesectordevelopment of applications to monitorbroadband connections.

The “touchdown” element of the vote wasthe chairman’s goal of following through on aproposal introduced over a year ago to codifythe network-neutrality rules and fulfi ll a campaignpledge by President Obama, a task madetougher by the U.S. Court of Appeals for theD.C. Circuit’s decision last April to strike downthe FCC’s handling of Comcast’s managementof traffic from file-sharing application BitTorrent,a ruling that questioned the agency’s enforcementauthority over Internet access.

‘ENFORCEABLE’ RULES

“While the commission had in the past pursuedbipartisan enforcement of Open Internetprinciples, we have not had properlyadopted rules,” Genachowski said of the decision.“Now, for the first time, we’ll have enforceable,high-level rules of the road to preserveInternet freedom and openness.”

But if past enforcement had been bipartisan(in the case of the August 2008 FCC votethat slapped Comcast for blocking BitTorrent,that meant Republican then-chairmanKevin Martin teamed with the Democrats),the Dec. 21 vote was purely along party lines.Still, not all Democrats were wholly pleasedwith the outcome.

It did not go far enough for Democrat MichaelCopps, who had pushed for reclassifyingbroadband Internet service as a telecommunicationsservice under Title II of the CommunicationsAct, subject to common-carrier rules.He essentially did not oppose the net neutralityrules, but his vote to concur was shortof approval. Both Copps and Democrat MignonClyburn had pushed for applying networkneutrality rules to wireless carriers, andClyburn also concurred in that part of the decisionrather than approving it.

Republican commissioners slammed thedecision — Robert McDowell said the FCC’svote would be overturned in court.National Association of TelecommunicationsOfficers and Advisers president Ken Fellman,an attorney with Kissinger & Fellman in Denver,agreed, saying it was “debatable” whetherthe FCC had achieved the regulatory certaintyit was advertising in the vote, or was “simplythe next move in an ongoing legal battle that willface more years of court challenges.”

GOP OPPOSITION

Republican legislators who had warned thechairman not to proceed with the Decembervote weren’t waiting for the wheels of thelegal system to start grinding, though theylikely can’t undo the decision legislatively ordo more than shake their collective fists at thedecision.

One consequence of the Dec. 21 vote was apledge by House and Senate Republicans to tryto block the implementation of the rules by allmeans necessary. The newly minted leadershipof the House Energy & Commerce Committeeand the House Communications Subcommitteewere particularly vocal in their displeasure.

Among those options are defunding theFCC’s ability to implement them, a Senate resolutionof disapproval or a House equivalentthat essentially nullifies an agency decision.

NEW RULES OF THE ROAD

The FCC adopted these three basic Internet regulations Dec. 21 in a 3-2 party-line vote:

1. Transparency: Fixed and mobile broadband providers must disclose the network managementpractices, performance characteristics, and terms and conditions of their broadband services.